StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

The role of de-regulation of the finacial system - Essay Example

Cite this document
Summary
The Role of De-Regulation of the Financial System Overview Deregulation is the process where the companies or the financial institutes obtain more independence or freedom to compete and to operate due to the various changes in the laws related to the financial sector…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER98.1% of users find it useful
The role of de-regulation of the finacial system
Read Text Preview

Extract of sample "The role of de-regulation of the finacial system"

Download file to see previous pages

It helps the organizations to acquire their objective’s assistance, monetary policies and financing in the public sector among others (Strahan, 2002). In various instances, the deregulation acts have been imposed focusing on the financial systems of industrial sectors in various countries. For example, one of the most crucial changes in the financial system’s regulations was the Gramm-Leach- Bliley Act, which was enacted in US in the year 1999. Similarly, in Australia the Financial Management and Accountability Act (FMA Act) was implemented in the year 1997 to ensure deregulation in the financial system of various industrial sectors.

These Acts in turn resulted in lessening the level of competition among the investment banks, traditional banks and various insurance firms. Furthermore, this act allowed the companies to take part in each and every segment of the markets based on specific situations. Hereby, the major objective of this study is to highlight the deregulation and its role towards the financial system to advance the interests of finance capital. Role of Deregulation in Financial Systems The deregulation on relation to the financial liberalization aspect has been comparatively a current experience in the context of globalization.

The deregulation reforms have been applied in major countries all over the world through certain steps or procedures such as China, United States and Australia. It is in this context that deregulation i.e. lesser intervention of government of a country has certain roles to play towards the financial systems in the economy as deregulation reforms tend to have string impacts over the financial sectors of every country fueling the scope of globalization (Clarke & Islam, 2004). It is worth mentioning that deregulation has certain advantages as well as certain disadvantages towards any economy and its financial system.

For instance, deregulation measures enacted in a financial system of an economy can motivate business entities to take part in the industrialization process more actively than compared to the period of regulated financial system. Moreover, with certain liberties in maintaining and participating in the financial system through deregulation measures, companies would also be more efficient and effective as a communicator of its viability and stability. However, as a negative impact of deregulation, companies or certain industry sectors can also engage malpractices in maintaining ethical standards while documenting their financial stability (Bowe, Briguglio & Dean, 1998).

Despite, its negative impacts, deregulation measures have been observed to enhance the financial system and industrial stability as well as competition of various countries. From a generalized point of view, it can be stated that these factors accumulatively have improved the scope of development in the financial sector in different countries (Organization for economic co-operation and development, 2001). Examples of Deregulation In the financial planning system of China, before the implementation of the deregulation in the Chinese economy (1953-1978), the planning authority was not supposed to control the economic actions of the country.

Before 1978 the business entities and the farmers had no independence and the right to take financial decisions for their businesses as the entire planning system was controlled by the government of the country. Before the revolution in China government had decided to devise a list of new economic policies to control the

...Download file to see next pages Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“The role of de-regulation of the finacial system Essay”, n.d.)
Retrieved from https://studentshare.org/sociology/1441782-the-role-of-de-regulation-of-the-finacial-system
(The Role of De-Regulation of the Finacial System Essay)
https://studentshare.org/sociology/1441782-the-role-of-de-regulation-of-the-finacial-system.
“The Role of De-Regulation of the Finacial System Essay”, n.d. https://studentshare.org/sociology/1441782-the-role-of-de-regulation-of-the-finacial-system.
  • Cited: 0 times

CHECK THESE SAMPLES OF The role of de-regulation of the finacial system

History of Financial Regulatory System in Australia and Singapore

The paper deals with the difference and similarities between the structure of the Australian Financial regulatory system and the Singaporean one.... It throws light on the history of financial regulatory system of both the nations with brief introduction of a well-structured financial system.... hellip; Besides the structure and functions of the financial regulatory system in Australia and Singapore it discusses the disclosure and corporate governance in both the countries....
11 Pages (2750 words) Essay

Financial Regulation in the Middle East

… These principles and norms relate to the Islamic commercial partnership laws, inheritance laws, the waqf constructs2 and Islam's legal system's preference for “juristic The United Arab Emirates (UAE) is poised to establish itself as a main regional financial services center....
60 Pages (15000 words) Essay

Current Trends in Global Bank Regulation

Some of the roles of banks include crating money, being the principle allocator of credit funds available to the public, they act as the managers of a country's payment system and they are the depositories of the public in matters relating their financial savings (Connor 2005).... The bank's regulatory role is divided into three functions which include controlling the supply of money in the economy, meliorating matters regarding equity and efficiency of intermediation of finances and preventing systematic risk....
12 Pages (3000 words) Essay

Economic Liberalism

According to Friedman, a capitalist economic system promotes freedom both directly and indirectly.... Capitalist economies play a crucial role in the separation of political power and economic power.... This essay talks about economics and politics which have an intimate connection though they are in different systems which is does not support the existing of both of them side by side....
5 Pages (1250 words) Essay

Government Deregulation and Business

Promoters of the free-market system espouse that regulations upset the positive influences of competition.... The discussion presented in the paper "Government Deregulation and Business" will give an explanation of governmental deregulation, why it is necessary, and the benefits and drawbacks of deregulation....
7 Pages (1750 words) Term Paper

The Effects of Bank Regulations, Competition, and Financial Reforms on Banks Performance

This study discussed the importance of making use of banking and financial reforms and regulations in terms allowing small-scale banks become competitive enough to face the financial challenges associated with the local and international banking competition.... hellip; This paper tells that in relation to the global financial crisis, there is a strong need for central banks to maximize the use of its banking and financial regulation and reforms....
38 Pages (9500 words) Research Paper

Public Policy Issues - Need For Regulation in the UK Financial Institutions

the role of public policy makers, which is most of the time the government institutions or their representatives comes here.... The report "Public Policy Issues - Need For Regulation in the UK Financial Institutions" considers a public policy issue of regulation of private financial institutions in the United Kingdom....
15 Pages (3750 words) Article

Financial Institutions and Regulation of the Republic of China

Aberbach, Dollar, and Sokoloff reveal that the financial institutions of Taiwan consist of the Central Bank of China, local branches of foreign banks, domestic commercial banks, medium and small business banks, investment and trust companies, credit cooperatives, insurance companies and the postal savings system (97).... redit insurance plays a major role in Taiwan as noted by Aberbach, Dollar, and Sokoloff (99)....
8 Pages (2000 words) Case Study
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us